Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, MUMBAI BENCH “SMC” MUMBAI
Before: SHRI R.C. SHARMA & SHRI PAWAN SINGH
ORDER PER PAWAN SINGH, JUDICIAL MEMBER;
This appeal by assessee is directed against the order of ld. CIT(A)-28, Mumbai dated 20.12.2018 for Assessment Year 2013-14. The ld. CIT(A) confirmed the order of Assessing Officer in levying the penalty under section 271(1)(c). The assessee has raised the following ground of appeal:
The Ld. AO erred in levying penalty of Rs.1,01,565/- under section 271(1)(c) of the Income Tax Act, 1961.
Brief facts of the case are that during the assessment for the year under consideration, the Assessing Officer noted that the assessee is showing sundry creditor from 3 parties which are outstanding more than 3 years. The Assessing Officer treated the said sundry creditor as income of assessee u/s 41(1) on account of cessation of liability. The Assessing Officer further noted that the assessee received interest of Rs.64,452/- on account of income tax refund but the same has not offered for income tax. The Assessing Officer also made addition of said interest income while passing the assessment order under section 143(3) on 19.01.2016. The Assessing Officer initiated penalty under section 271(1)(c), notice under section 271(1)(c) dated 30.01.2016 was served upon the assessee. The assessee filed its reply on 07.07.2016. In reply, the assessee contended that he has no intention to conceal the income or to furnish inaccurate particular of income. The assessee has shown all the creditors in his return of income and had no intention to hide any particular and did not any net particulars of income for interest income. The assessee contended that he was not aware about the interest income earning received on account of refund. However, the assessee has disclosed whole amount in the books of account and had no intention to hide any source. The assesse also relied upon the decision of Hon’ble Apex Court in CIT v. Reliance Petroproducts Pvt. Ltd (2010) 322 ITR 158(SC). The reply of assessee was not accepted by Assessing Officer by taking view that assessee fail to voluntary offer the income on which additions were made. The Assessing Officer by invoking Explanation 1 of section 271(1)(c) levied the penalty @ 100% of tax sought to be evaded. The Assessing Officer worked out the penalty of Rs.1,01.565.
On appeal before learned Commissioner (Appeals), the action of Assessing Officer was affirmed. Thus further aggrieved the assessee has filed present appeal before us.
None appeared on behalf of the assessee despite the service of notice through RPAD. No application for adjournment is filed on behalf of the assessee perusal of record reveals that authority letter of CA Shri Vimal Punamia is available on record.
We have heard the submissions of the ld DR for the revenue and perused the record. The Ld. DR for the revenue supported the order of Assessing Officer. The Ld. DR further submits that during the assessment, the Assessing Officer noticed that the assessee is showing sundry creditor from 3 parties of total of Rs.2,64,239/-. The outstanding of sundry creditors were for more than 3 years. The Assessing Officer disallowed the same sundry creditor and treated the same income on account of cessation of liability under section 41. On addition, the Ld. DR submits that it was received interest income of Rs.64,452/- on account of income tax refund but the same has not been offered by assessee for taxation. The Assessing Officer after issuing show cause notice and considering the replying disallowance made addition on account of interest income. The Assessing Officer levied penalty of both the additions. The assessee on show cause notice failed to offer the frame explanation before the Assessing Officer. The Assessing Officer treated the levied penalty on both the addition.
Before Tribunal, the assessee has not furnished any documentary evidence or submission to substantiate whether the assessee has not shown any reasonable explanation or not levying the penalty.
We have considered the submission of Ld. DR for the Revenue and perused the material available on record. There is no dispute for while passing the assessment order, the Assessing Officer made two additions number one addition under section 41(1) of Rs.2,64,239/- and addition on account of interest income on income tax refund. There is no material on record to show that any further appeal was filed by assessee before first appellate authority. The Assessing Officer levied penalty @ 100% of tax sought to be evaded. Before the Ld. CIT(A) confirm the penalty that the assessee has not voluntarily offered the respective amount for taxation. The assessee was in know of the fact that sundry creditor outstanding and treated the same as income of assessee under section 41(1) of the Act. Further, on the interest income, the Ld. CIT(A) concluded that interest income on income tax refund is clearly taxable yet the same was not offered in the return of income. Before us, neither the assessee has come forward nor filed any written submission or any documentary evidence to show reasonable explanation about not occurring income added by Assessing Officer in the assessment. In absence of any material before us we affirm the order of the Ld. CIT(A).
In the result, the appeal of the assessee is dismissed.